Penticton's 66-year-old Memorial Arena will require $13.5 million in upgrades in the coming years to remain viable. Taxpayers will have to look at other options available such as replacing the building as the city looks to address its infrastructure deficit, says acting CAO Mitch Moroziuk.

(STEVE ARSTAD /InfoTel Multimedia)

October 04, 2016 - 6:30 PM

PENTICTON - The City of Penticton's $175 million infrastructure deficit is not a crisis so much as a wakeup call, says the acting chief administrative officer.

Moroziuk said not enough attention had been paid to upgrading and replacement of infrastructure in Penticton, resulting in the city’s infrastructure having an average remaining lifespan of just 48 per cent. As a result, infrastructure failures can be expected to occur more often.

He said the city ended up with a $175 million infrastructure deficit because of flat population growth, declining senior levels of government responsibility and a five year period between 2011 and 2015 when the city imposed low or no tax increases.

Future funding may come from such things as tax increases, a sharing of services with other jurisdictions, population growth, grant lobbying, the sale of non-core assets, through the adjustment of service levels or through a combination of those options, Moroziuk suggested, noting the city could no longer rely on debt, use of reserve spending or doing nothing.

A proactive approach developing a range of actions was now necessary, he said.

He noted other municipalities increased taxes - in the case of Grand Forks, 15 per cent, and Vernon, at 3.4 per cent - to set aside money for asset management. In Victoria, the city set aside surplus funds generated by residential growth.

City staff are in the process of developing a long term plan to deal with the replacement and repair costs associated with aging infrastructure in the city, with Moroziuk urging Penticton residents to take part in a dialogue about the issue over the next two months. Staff hope to have a plan in place in time for budget implementation in 2017.

The city is targeting 2027 as the year in which infrastructure costs and budget allocations will be equal.

“The sky is not falling, we’re identifying the need for a plan,” Mayor Andrew Jakubeit said, noting just eight per cent of every tax dollar collected in B.C. goes to municipalities. “Our infrastructure is getting older, and we have to start chipping away at it."

Coun. Max Picton urged the community to get involved in the discussion.

“We’re talking about shutting down facilities, reducing service levels. Council will be making some tough decisions. I strongly urge people to get involved with this,” Picton said.

We welcome your comments and opinions on our stories but play nice. We won't censor or delete comments unless they contain off-topic statements or links, unnecessary vulgarity, false facts, spam or obviously fake profiles. If you have any concerns about what you see in comments, email the editor in the link above.

OPINION A report has recently stated that the average cost of food will inflate near double its average annual rate. This does not include fresh produce and most animal proteins. The inflation for these products may t